Germany must lower its 2008 economic growth forecast

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BERLIN, Dec 27 (AP): Germany's economy minister said the government must lower its 2008 economic growth forecast, according to an interview released Wednesday.
The current forecast for Europe's biggest economy, which dates back to October, is for gross domestic product to expand by 2 per cent in 2008, following growth of 2.4 per cent this year.
"We will have to go back somewhat on our growth estimate for 2008," Economy Minister Michael Glos was quoted as saying by the weekly Die Zeit. He did not give a potential new figure.
However, he said other factors "will have a positive effect on employees' purses," citing a cut in a payroll levy for unemployment insurance that would take effect January 1 and the likelihood of relatively high settlements in pay negotiations next year.
A cut in the government's growth outlook would put it in line with recent moves by some German economic think tanks to cut their 2008 forecasts to less than 2 per cent.